Michigan Senate votes to continue health insurance tax - WNEM TV 5

Michigan Senate votes to continue health insurance tax

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LANSING, Mich. (AP) -

Michigan's tax on health insurance would continue into 2020 under legislation narrowly approved by the state Senate.

The Republican-controlled chamber voted 21-17 Wednesday to extend the health insurance claims assessment, which helps pay for Medicaid for low-income residents. The tax goes away in two years if the bill isn't enacted.

The Michigan Chamber of Commerce has called it a "giant tax hike."

If the tax isn't extended, Medicaid spending could be cut starting in 2017-18 unless another source of funding is used.

The Senate changed a House version of the bill and voted to continue the tax until 2020 instead of 2025. The legislation goes back to the House.

The 0.75 percent tax will rise to 1 percent when the federal government no longer allows another tax to fund Medicaid.

Copyright 2016 Associated Press. All rights reserved.

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